Govt prepares strategies for withdrawing funds kept in Singapore
Batam, Riau Islands (ANTARA News) – Indonesias finance ministry is preparing four strategies to withdraw funds worth Rp1,500 trillion kept in Singaporean banks, an official stated here on Wednesday.
“We are preparing four strategies,” remarked Deputy Minister of Finance Bambang Brodjonegoro.
The four strategies are tax incentives, eradication of double taxation, encouraging the issuance of new financial industry products, and creating a special financial industrial zone.
“They are rich people who need security assurance and high yield,” he claimed.
Bambang noted that the government is currently working on a tax incentive that can possibly be applicable on financial products.
He added that the tax incentive was not tax abolition, but tax elimination for new instruments.
With regard to double taxation he emphasized that the government has never recognized double taxation.
“It is not allowed to impose tax twice on the same thing,” he stated.
Regarding the third strategy Bambang reported that the government will encourage the issuance of new financial products to absorb the funds of Indonesian citizens that are currently stacked up in Singapore.
He explained that in another strategy the government will explore the possibility of setting up a special banking zone, which will be located close to Singapore to make it easier for the Indonesian citizens in that country.
The policy is aimed at setting up offshore banking, which is basically a banking system that prioritizes trust and banking tax incentives, he noted.
Apart from the four strategies he emphasized that the government will also take efforts to pull the funds of oil and gas production sharing contractors that have so far been kept abroad.
“We will encourage the contractors to direct their foreign exchange income to Indonesia. What is most important now is that the funds will enter Indonesia, even just for a few minutes,” he added.
He pointed out that some production sharing contractors or KKKS contractors have indeed been loyal by keeping their funds in Indonesia, but some others still reject and keep their funds at home.
“There are also some who reject even for a short time,” he added.(*)